Alignvest Acquisition II shows there is life in the SPAC market, closes $350 million IPO with more to come

Barry Critchley: For those who thought that the market for special purpose acquisition companies, or SPACs, was dead, a little rethink is required

News Alignvest Acquisition II shows there is life in the SPAC market, closes $350 million IPO with more to come

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How Alignvest Acquisition II shows there is life in the SPAC market, closes $350 million IPO with more to come

For those who thought that the market for special purpose acquisition companies, or SPACs, was dead, a little rethink is required given the fundraising efforts of Alignvest Acquisition II Corporation.

The issuer, which is sponsored by the same people who unveiled the original SPAC, Alignvest Acquisition Corp., has priced its initial public offering. It ended up with $350 million with the possibility of another $52.5 million being raised if the underwriters exercise the 15 per cent over-allotment option. They have 30 days to decide whether to exercise – or not.

If it is exercised then Alignvest II will have equaled the record for the largest ever SPAC in the public markets. It will share that record with Acasta Enterprises, which completed its IPO in the summer of 2015. When it started in its road show, Alignvest II had hoped to raise $250 million.

But on another measure, total deal size, Alignvest II is in a league of its own: prior to doing a public financing, it raised $113 million on a private placement basis. That capital will be employed when a qualifying transaction is announced. It was raised to help ensure that Alignvest II had enough capital on hand in the event that shareholders exercised their right to request the return of their original investment (plus some interest).

By another measure, Alignvest II has set another record: it holds the mark for the largest IPO year to date.